Questions tagged [liquidity]
Liquidity describes the degree to which an asset or security can be quickly bought or sold in the market without affecting the asset's price.
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Why is the half spread considered the transaction cost?
I know there are other questions that address this, but I'm a little confused on the intuition.
Say bid is 90, weighted mid is 90.4, and ask is 91. So the bid/ask spread is 1. If I want to sell now, I ...
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What is the least liquid way to keep money?
I'm trying to keep my money safe from hackers and don't want them getting easy access. Keeping it in a checking account seems like the worst idea since it's too easy for them to just move the money ...
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Can one get a liquidity premium as a retail investor?
Is it possible to get a liquidity premium as a retail investor? That is, between the following two options, I would expect there to be a theoretical extra return to doing (2):
Hold an index fund for ...
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Consequences of liquidity crisis to passive ETFs to a buy-and-hold investor
Various sources raise the risk faced by passive investing ETFs, such as index funds, in the event of a liquidity crisis. One such example is the Investopedia article Why Passive ETFs Face Big Risks in ...
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How big participants consume liquidity
I’m currently studying order flow, and one thing I see a lot is that big participants or institutional traders don’t use market orders in order not to get slippage, instead they use limit orders ...
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Who's on the other side of very illiquid option contract trades?
So I've been short selling Deep-in-the-Money, far from expiration Put Options on an ETF for about a year now, to profit from upward price movements on the underlying and time premium decay.
Volume for ...
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If I have two assets that both have the same returns, but one is liquid and the other is not, how do I calculate the difference in value between them?
Let's say I have $20,000 in a stock that reliably returns 5% every year ($1,000). I also have an intangible asset that passively earns me $1,000 every year, as reliably as that other stock. Maybe it'...
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What is "trading for liquidity reasons"?
In this paper, it says:
For example, routine sells by insiders are commonplace in the market, and can be driven by diversification or liquidity reasons ...
What exactly does “trading for liquidity ...
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How do I make shares post-IPO liquid?
I have an option grant I exercised at a pre-IPO company through Carta.com, which shows I have X shares in the company of Common Stock.
The company IPO'd. I didn't sign a lock-up agreement although was ...
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What would happen to the price of a high-demand, no-supply asset once liquidity reaches 0?
If there was an asset with a fixed supply and ever increasing demand, what would happen to its price once all holders of said asset refused to sell? Obviously this is practically impossible, but just ...
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Liquidity of ETFs and Authorized Participants
I will buy the Vanguard Ftse All-World Units Etf A through my bank on Borsa di Milano (the Italian Stock Exchange). I have been told by the financial advisor of my bank that these assets have a small ...
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Best place to keep savings for home down payment?
I'm currently saving for a first home down payment (in USA), but don't want to keep a large pile of money sitting in a low-yield savings account while I'm looking for the right home. I want to find a ...
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What is "negative liquid assets" called?
I technically have $3000 on my bank account. However, I have -$2000 in "liquid assets", as determined by my little software system which I've made.
Basically, it takes the money I have and ...
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Question for Xenith (Eikon) Expert - Is the following data available...?
In the ''Universe'' tab are many different options: Government and Corporate Bonds, Equities, Funds, Indices, Equity & Index Derivatives, Companies/Issuers, Commodities, FX & Money, Benchmarks ...
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Why is capitalization because of revenue fall important?
I have a question: Why is extra capital important in case of revenue drop, either quarter or annual revenue?
I'm asking: what are the benefits of getting large amounts of extra capital if revenue drop ...
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